[Day 4] Vietnamese, you are even poorer than you think

Have you ever realise sometimes you are indeed not as abundant as you think. You might think that with your monthly salary of about 10 million VND it would never be too extravagant if you buy bubble tea two times per week. Let’s take a little calculation here, say, 40,000 VND for 1 bubble teacup, multiply by 8 times equal 320,000 VND, approximately 3% your income. That seems to be a minor figure at first glance. However, we would not only take such a simple calculation to prove it is a reasonable living cost. To make an exact comparison, we need to take the average living standard of other countries as well as the average a closer look at why Vietnamese people are getting poorer by spending the wrong way and how we can prevent it.

There are several definitions of poverty depending on the context of the situation it is placed in, and the views of the person giving it. According to the World Bank, “Poverty is pronounced deprivation in well-being and comprises many dimensions. It includes low incomes and the inability to acquire the basic goods and services necessary for survival with dignity”. To the extent of this article, the author would consider absolute poverty by using monetary indicators.

Compared to other countries, Vietnam should take the percentage indicator into consideration. In my opinion, a country is more impoverished than other countries in which its ratio of average monthly living cost out of income is higher than that of others. For example, we will compare 2 sets of figures between Vietnam and Germany, a developed country with relatively high productivity. According to Trading Economics database in January 2018, average minimum wages excluded tax in Vietnam is 0.96 EUR per hour (4,180,000 VND per month), nearly 10 times lower than the figure for Germany, which is 9.19 EUR per hour. Regarding the wage for high-skilled labour, the number of Vietnam is 2.5 EUR per hour (10,825,600 VND per month), which is 750% lower than Germany’s. At the same time, depending on the relatively large survey on Expatian (a collaborative international cost-of-living index website) to the scope of 250 people, the cost of living in Munich (the most expensive city in Germany) is 96% higher than in Hochiminh City (the most expensive city in Vietnam). It should be from 7.5 to 10 times, depending on the above comparison of average salary between 2 nations. In short, Vietnamese people have to spend around 5 times higher than German.

So why would we always think we are becoming richer with that figure, and about to spend more on luxury goods as a way to indulge ourselves. Back to the beginning example, even the bubble tea prices in Vietnam is 2 times lower than in Germany, it is still not as cheap as we hitherto think, not to mention it belongs to one kind of luxury goods — the one is not necessary for you. We are spending too much on luxury goods, as well as foreign commodities. We justify that we buy products depending on their quality, but is this really our purpose? In my opinion, a majority of Vietnamese people are being affected too much about the appearance, as well as the tag value of their belongings. They want to show off their social value by shallow things, such as expensive car or motorbike, iPhone and all the dining and wining, even if they are out of their league. Let’s take a realistic example, a friend of mine, whose earning per month is about 7 million VND dong, unhesitatingly by a shampoo of Penaten, a German brand, with the price of 200,000 VND; while a German mother just has to spend 2.95 EUR for it. Additionally, my friend’s wage is only 15% of the amount of that German woman.

We can not influence the gap between the salary and living standard of Vietnam and other countries, yet we definitely can alter our spending behaviour by curtaining our expenditure not only on expensive products but also on unnecessary commodities, such as bubble tea. One of the most effective solutions at the moment, when the Vietnamese brand’s commodities are available in a wide variety, is pick up a local product before considering foreigner ones. Some people may blame on local brand’s low quality, however, many Vietnamese manufacturers are producing their products, applying advanced technology with reasonable prices, such as clothing, smartphones and even automobiles.

In conclusion, by letting numbers speak, we had a comprehensive understanding of the current living standard of Vietnamese people in comparison with developed countries, as well as the measure we can apply to bridge the gap. As a consequent, we should be determined by core value, instead of face value in choosing which we would buy.